Operating profit margin
Operating profit as a percentage of net revenue. It shows how much of each sales dollar remains after the costs of running the core business.
In Solo Superstars
Use the figures in Reports › Income statement: subtract operating expenses from gross profit, divide the result by net revenue, then multiply by 100. The report currently shows those components rather than a separate operating-margin line. Interest, taxes, and other non-operating income or expenses are excluded.
Example
Net revenue 15,600 − COGS 3,200 − operating expenses 8,900 = operating profit 3,500. Operating profit margin = 3,500 ÷ 15,600 × 100 = 22.4%.
Codes shown are the defaults a new workspace starts with. Yours may be renamed or renumbered — check Accounting › Chart of accounts. See the full default chart.
Also called
- operating margin
- operating income margin
Related
- Income statement — Revenue, costs and expenses over a period, ending in net income. The report that says whether you made money.
- Revenue — What you earn from customers before any costs: product sales, services, shipping charged. The top line of the Income statement.
- Gross profit — Revenue minus cost of goods sold. What is left to cover everything else.
- Operating expense — The cost of running the business: rent, software, meals, insurance, payroll. The 6000–7999 accounts.
- Net income — Revenue minus every cost and expense. Rolls into retained earnings at year end.